Merger Lite: Law Firms Looking to Acquire Smaller Groups
The Legal Intelligencer
July 12, 2011
Fox Rothschild Administrative Partner Mark Silow is quoted in an article from the Legal Intelligencer about a recent report that shows an increasing number of law firm mergers across the country have been acquisitions of small boutiques or groups.
Fox Rothschild has acquired close to 10 boutiques since 2005, with the bulk of them coming between 2005 and 2007.
Administrative partner Mark Silow said the firm is continuing to talk to other smaller shops, which he says the firm prefers over large mergers for several reasons.
"There just is less risk in doing a smaller deal rather than a larger or a mega-deal," Silow said. "Second, we like boutique firms because we find that the quality of the lawyers and the quality of the clients is generally higher than in a small- to medium-sized general practice kind of firm."
The bigger the deal, the more risk there is that, if the additions fall short of their projections, the firm is left with a larger financial investment that didn't pay off, Silow said.
The other reason the firm goes for smaller additions is that it is simply easier to integrate a smaller group, he said.
"In some mega-mergers, you are taking two firms and blowing them up and hoping that the third firm that emerges is better than either of the two firms that you just blew up, and, quite frankly, we're happy with the culture and the governance of our firm and we are looking to preserve that," Silow said, adding that Fox Rothschild doesn't want to "undergo that kind of radical surgery that is inherent in mergers of equals."
The 450-lawyer firm does have some experience in bigger deals, having acquired more than 50 lawyers in its 2006 acquisition of New Jersey-based Grotta Glassman & Hoffman. Silow said that merger was a great success, projecting Fox Rothschild onto a national stage by adding offices in California and Las Vegas.
"Although that was a tremendous success, it also highlighted to us the difficulty of doing a merger of just that magnitude," he said. "That's about the high end of our scale of what we would likely undertake again."